Contributed by Robert Lyman © 2023. Robert Lyman’s bio can be read here.


At the last Conference of the Parties to the Framework Convention on Climate Change held in Egypt in 2022 (“COP27”), the Parties decided to establish a fund for responding to “loss and damage”. The concept of “loss and damage” is, in principle, the basis upon which the wealthier countries should now pay compensation in various forms for historic emissions. COP27 established a transitional committee to work on “operationalizing” a new loss and damage fund, which is to be approved and adopted at COP28. COP 28 will be held in Dubai in November and December this year.

A Summit for a New Global Financing Pact, held in Paris, France on June 22 and 23, 2023, under the chairmanship of French President Emmanuel Macron discussed how to create new sources of funding for loss and damages. At the conference end, there was no significant progress to report on these subjects, a result that sends an early signal of what probably will happen at COP28.

However, the discussions examined several new mechanisms for extracting money from the wealthier countries like Canada. These included:

• A fossil fuel extraction levy, a global tax on all oil, gas, and coal producers.
• An air passenger ticket levy, a tax on every international and domestic passenger trip
• A levy on all international shipping based on each ship’s consumption of heavy fuel oil
• A tax on oil and gas industry “windfall profits” resulting from sudden increases in world prices
• A financial transaction tax on all financial instruments such as bonds, stocks, options, derivatives, and currency exchanges
• A stock buyback tax, imposed when a company purchases its shares of its own stock on the public market
• A special tax on “wealthy individuals”

The discussion of financial mechanisms is taking place in the context of what appears to be irreconcilable positions on the part of the “Annex II” countries (i.e., the mostly OECD countries identified as able to pay) and the rest. One group keeps raising the ante in terms of the amounts demanded and the other grudgingly agrees to discuss such funding “in principle” while refusing in practice to go beyond what the publics in the OECD countries find tolerable.

It seems inevitable that COP28 will fail to make significant progress in resolving the financing issues. For that, the people in the OECD countries should be very grateful.